Sensex loses 300 pts on RBI's hawkish policy; SBI dips 4%

At 14:14 hours IST - continuous downtrend in banking & finance, realty, metal, telecom, power and pharma stocks was hammering the benchmark indices. The Nifty was consistently trading below the 4,900 mark while the Sensex was hovering around the 16,500 level.

RBI's (Reserve Bank of India) hawkish credit policy was the main concern behind this fall, wherein RBI tightened NPA (non-performing asset) norms for banks and increased real estate provision to 1% from 0.4%. It also revised inflation target to 6.5% from 5% for March 31, 2010.

The Nifty tumbled 103 points to 4,867 and the Sensex was down 314 points to 16,426. The Nifty November future was trading with 16-19 points premium while October future with 5-7 points premium.

The broader indices were underperforming the benchmark indices; the BSE Midcap Index fell 3% and Smallcap Index lost 3.7%. About 131 shares advanced while 1,147 shares declined on the NSE.

All sectoral indices were in the red. The BSE Realty Index tumbled 6%. Metal Index was down 4% and Bankex down 3%. Power, FMCG, TECk, Oil & Gas and Capital Goods indices fell 1-1.9%.

In the largecaps, Bharti Airtel, SBI, ICICI Bank, DLF, Sterlite Industries, Tata Steel, SAIL, Unitech, Tata Power, SAIL, Hindalco, Reliance Communication and Jaiprakash Associates lost 2.5-8%. Reliance Industries was down over 1%.

In the midcap space, PTC India, KEC International, MindTree, Carborundum and 3M India gained 2.8-3% while Omaxe, HDIL, Puravankara Projects, Jet Airways and Bajaj Hindusthan fell 7.7-9%.

In the smallcap space, Prime Securities, Navin Fluorine, Zensar Tech, Jindal Worldwid and Greaves Cotton went up 3.5-9.5%. However, Aptech tumbled 15.6%. Disa India, MIC Electronics, JSW Holdings and Murli declined 10% each.

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